Knowledge Transfer within Formal and Informal Bank Communities: an Ecological Approach
Abstract Banks are gradually becoming aware that knowledge cannot be treated as an organisational asset without the active and voluntary participation of the communities that are its true owners. A shift to thinking of employees as volunteers requires us to think of the organisation as a complex ecology in which the number of causal factors renders pseudo-rational prescriptive models redundant [15]. The aim of the paper is to propose to the reader an holistic understanding of the different types of community and community interactions within a bank, rooted in the cultural and situational context of both that organisation, its changing environment and the network of formal and informal communities that make it a living entity. In order to do this, we have decided to apply a very peculiar model, named “Cynefin Model” [15], very useful in order to understand the flow of knowledge between communities within an organisation.
Francesco Virili Dipart. Scienze dell’Economia e della Gestione Aziendale Università Cattolica del Sacro Cuore
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Within a knowledge ecology, focus on people does not only imply understanding of knowledge exchanges and relationships based on such exchanges. It also implies understanding of how such knowledge influences action or potential for action based on such exchanges.
2. The Cynefin Model Applied to Banks’ Organization The Cynefin model (fig. 1) [15] has been used to assist banks to understand the ecology of knowledge. Cynefin is a Welsh word with no direct equivalent in English and it is translated as habitat, as an adjective acquainted or familiar, but dictionary definitions fail to do it justice. Cynefin model: cultural sense making Restricted
Informal I n t e r -d e p e n d e n t Symbolic Language
Training
Knowledge ecology essentially refers to a field of management theory and practice, focused on the relational and social aspects of knowledge creation and utilization. Its primary domain of action is the design and support of knowledge ecosystems, in which information, ideas, and inspiration cross-fertilize and feed on one another. It primarily focuses on the social networks analysis of individuals in contrast to the overly technological emphasis of traditional knowledge management systems (the Newtonian approach) on computers and information technology networks [5] and is made up of knowledge nodes and knowledge exchanges or flows. In the knowledge ecology the basis for cooperation and survival is differentiation and integration between the knowledge nodes. Highly differentiated knowledge nodes can collaborate to accomplish specific actions and may dissolve thereafter. However, collaboration between such nodes would require that they be able to 'relate' to one another under an overarching mission or theme [15].
Learning
1. A Premise: What is a Knowledge Ecology?
Professional Logical Expert Language
CULTURE
Uncharted Innovative Emergent Language
SENSE MAKING
Franca Cantoni CRATOS Università Cattolica del Sacro Cuore
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Bureaucratic Structured Common Language
Open
Figure 1
The Cynefin model
An early form of the Cynefin model using different labels for the dimension extremes and quadrant spaces was developed as a means of understanding the reality of Intellectual Capital Management within IBM Global Services [15]. It has been used subsequently to assist a range of other organisations to understand the ecology of knowledge and the representation in fig. 1 reflects that experience and thinking. Here is a brief description of the labels for the extremes of the quadrants.
1.1 The Dimension of Culture When implementing a KM system within a bank it is important to look into its culture. Throughout the literature it is apparent that the academic community is wrestling with the proper definition and description of the term “organizational culture”. Every organisation has its norms, values and beliefs. Together these constitute the organisational culture. More formal definitions can be attributed to Pettigrew [9], “Organisational culture consists of the behaviour, actions and values that people in an enterprise are expected to follow”, and Moorhead and Griffin [7], “Organisational culture is a set of values, often taken for granted, that help people in an organisation understand which actions are considered acceptable and those which are unacceptable”. Basically, organizational culture is the personality of the organization. Culture is comprised of the assumptions, values, norms and tangible signs (“artifacts”) of organization members and their behaviors [6]. A more extensive definition is given by Schein [12]: “Culture comprises a pattern of basic assumptions invented, discovered or developed by a given group as it learns to cope with its problems of external adaptation and integration that has to be worked well enough to be considered valid and, therefore, is to be taught to new members as the correct way to perceive, think, and feel in relation to those problems”. Schein points out also that the term “culture” alludes to two critical elements: structural stability and integration [13]. The first element - structural stability - refers to a set of commonly held beliefs deep within the organization, not easily identifiable when viewing surface behaviours and practices. The second element integration - is noted by Schein as the myriad of behavior patterns that combine to mold the organization identity.
1.2 The Dimension of Sense-making Sense-making is an approach to thinking about and implementing communication research and practice and the design of communication-based systems/activities. It consists of a set of philosophical assumptions, substantive propositions, methodological framings, and methods. The function of KM in any organisation is to make sense of things, both to oneself and to the communities with which one is connected. Sense-making extracts two assumed mandates: a) to make sense without complete instruction in a reality which is itself in flux and requires continued sense-making; b) to reach out to understand the sense made by others for the help it provides in the continuing species problematic.
Sense-making emphasizes the importance of the latter assumption in particular for it is not rooted only in a relativistic epistemology, rather it is rooted in an assumption that humans must muddle through together, and the tools they have which assume an ordered reality are useful only to a portion of their sense-making mandates [1].
2. The Cynefin Quadrants It is important to remember that models such as this are designed to assist in developing self-awareness and the capacity to describe the ecology in which one works. The borders between each quadrant are ambiguous in most organisations.
2.1 Bureaucratic/Structured Communities This is the formal organisation; the realm of bank policy, recruitment procedures, financial controls, internal marketing. It is a training environment, its language is known, explicit and open. The bank has high volumes of information and embedded knowledge to communicate on a regular basis to a diverse population. Increasingly the volume of information communicated by organisations results in data glut and a failure to create meaningful messages; messages that do not inform the recipient remain as data. In many organisations corporate communications are de-facto ignored by field staff who have too many other demands on their time. Filtering and the shift from push to pull information provision is one solution.
2.2 Professional/Logical Communities The most commonly understood form of expert language is that of the professional. The expert language and the time and basic skill it takes to acquire it form the barriers to entry and define the nature of the restriction. Such communities are working at a high level of abstraction that is the process by which we focus on the underlying constructs of data. Abstraction is the process of taking away or removing characteristics from something in order to reduce it to a set of essential characteristics In definitive, such communities are characterised by a high degree of assimilation and use of their organisation's culture together with peculiar sense-making skills; when communicating, they use an expert language expressing abstract concepts not shared neither easily understandable by a 'novice'.
2.3 Informal/Interdependent Communities
Informal communities are more rigidly restricted than professional ones. The community uses criteria for the inclusion or exclusion of members that are unspecified and rarely articulated, but intuitively understood. Membership is always ambiguous and if lost can result in bad feeling arising from a sense of personal betrayal that goes beyond the normal cut and thrust of organisational politics in the formal organisation; it generally transcends other loyalties and organisational boundaries. That is: the degree of organizational culture is low; there are little or no common implicit or explicit rules to discipline the components behaviour and therefore it is very difficult for the non-members to enter the community by acquiring organizational culture with observation or experience. They often communicate using an exclusive symbolic language, which is not easily understood by nonmembers.
2.4 Uncharted/Innovative Communities So far we have dealt with the two forms of restricted communities in which a specialised language, explicit or symbolic, is developed to make sense of incoming stimuli. We now reach a domain in which such language does not exist because the situation is new. The newness may be technology-induced, creating new possibilities. We have no ideas of what it is that we need to train, and the language of our previous expertise may be inappropriate at best, or appear to be appropriate (even though it is not) at worst.
3. Knowledge Movements and Transfer The value of the Cynefin model is in its ability to assist in descriptive self-awareness and to understand the flow of knowledge and its transfer inside the organisation – and appropriately, a bank. In KIOs - as banks actually are - competitive advantage and service success are a result of collaborative, ongoing learning. Success depends not only on how effectively the diverse individuals are able to organize and develop their unique knowledge competencies, but also how they can integrate and utilize their distinctive knowledge both effectively and synergistically [2], [8]. Such collaborative, ongoing, mutual learning by both the individual expert and the team is required because the problem solving and innovation that characterize banks are unsolveable epistemologically by any one person and require continual insights from a variety of perspectives. Knowledge transfer indicates conveying or moving knowledge from one person or place to another [10]. In our case, it relates to how we move knowledge from a
community to another one. Most of them are not single communities of practice, but, rather, hybrid groups of overlapping and interdependent communities. Such hybrid collectives represent another level in the complex process of knowledge creation.
3.1 Cross-community organization Cross-community organization is important because it helps to overcome some of the problems communities of practice create for themselves. For instance, isolated communities can get stuck in ruts, turning core competencies into core rigidities. When they do, they need external stimuli to propel them forward. Communities of practice, while powerful sources of knowledge, can easily be blinkered by the limitations of their own world view. In a study of technological innovation, for example, Raghu Garud and Michael A. Rappa [4] show how even the most sophisticated of knowledge workers can fail to recognize quite damning evidence. New knowledge often requires new forms of evaluation, and when the two are produced together, knowledge, belief, and evaluation may only reinforce one another, while evaluation independent of that belief appears irrelevant. Garud and Rappa's study explores this self-deluding/self-reinforcing social behavior in highly technological communities, where counterevidence is usually assumed to be easily capable of overwhelming belief.
3.2 From synthesis to synergy: the role of the management of the bank As we know from experience, cross-divisional synthesis is itself an achievement. But banks must reach beyond synthesis to synergy. In doing so, they both draw on and continuously create their unique organizational know-how their ability to do what their competitors cannot. For this they must produce true, coherent organizational knowledge. Banks that fail to achieve this particular synthesis are most likely to fall prey to market alternatives. We have to consider that some knowledge moves quite easily. People assume that it is explicit knowledge that moves easily and tacit knowledge that moves with difficulty. It is, rather, socially embedded knowledge that sticks, because it is deeply rooted in practice. Within communities, practice helps to generate knowledge and evince collective know-how. Consequently, trying to move the knowledge without the practice involves moving the know-what without the know-how. Due to its social origins, knowledge moves differently within communities than it does between them. Within communities, knowledge is continuously embedded in practice and thus circulates easily. Members
of a community implicitly share a sense of what practice is and what the standards for judgment are, and this supports the spread of knowledge. Without this sharing, the community disintegrates. Different communities of practice have different standards, different ideas of what is significant, different priorities, and different evaluating criteria. Taking into account what it has been said, one of the primary roles of the bank management in such a knowledge ecology is to manage the border areas between quadrants. The richest opportunity area is that between the two expert language groupings at the top of the model. As we “make sense of the senseless”, so a group of interdipendent individuals who have pioneered that understanding develop an expert language that is as yet not fully articulated. It is very tacit, based on the common experience of sense making. Over time this will be codified at an appropriate level of abstraction and pass into a broader community of trainable experts. The borders between formal and informal actually cross each area. Informality creeps into competence groups, for example. Equally, in the main, it takes a corporate intervention to make sense of the senseless, so the bulk of that domain is formal. What we cannot do is to achieve a hub position which is the idealistic position adopted by the members of the mechanical/newtonian school.
4. Conclusions Banks (as well as others KIOs) require diverse, specialized knowledge workers develop unique knowledge competences, and also collaborate in ways to create new knowledge that enhances the performance of the organization. The Cynefin model - where each quadrant represents a particular coalescence in time and space of a form of community with varying degrees of temporal continuity - helped us to classifiy communities inside a banking organization and the flow of knowledge esisting between them.
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